The campaign

Palm oil has been a big issue on the sustainability agenda for many years now. Despite the best efforts of the Roundtable on Sustainable Palm Oil (RSPO), and genuine improvements in responsible sourcing by several major brands, there are still serious issues around lack of transparency, deforestation, and threats to biodiversity.

In April this year palm oil was the subject of a high profile NGO campaign. Greenpeace put its weight behind tackling Nestlé's palm oil sourcing practices and used its flagship brand Kit Kat as the target.

Greenpeace's campaign against Nestlé was rolled out with a viral ad campaign, social media campaign and traditional on-the-ground activism targeting the company's AGM and offices in the UK and Europe. Nestlé responded by changing policy and severing contracts with Sinar Mas, a major palm oil producer and supplier that had been heavily criticised by Greenpeace for deforestation and peatland clearance in Indonesia.

Greenpeace then moved the focus to HSBC, which invests in Sinar Mas, by lampooning the global bank's advertising messages. Again, the pressure was successful, and HSBC dropped its investment.

Greenpeace's campaign against Sinar Mas continued with a focus on other areas of its business – the paper and pulp industry. The combined effects have caused other multinational companies to protect their brands and reputations by distancing themselves from alleged irresponsible behaviour in the supply chain.

Of course, it was not Greenpeace's actions alone that created this change but the power of social media. The story was followed closely by specialist media, such as Greenbiz and Treehugger, as well as mainstream media such as the Guardian and newswires like Reuters. There was also a large amount of commentary on blogs, which accounted for 70% of the conversations about palm oil on the web during the six month period to September 27, and of course, the NGOs were vocal and influential.

The combined effect of all these voices was a damaged reputation and loss of business, reflected by a dip in its share price, for Sinar Mas.

Greenpeace's campaign brought the issue of palm oil back to the top of the agenda for many companies. This plays out all the interlocking complexities and trade-offs that make sustainability so challenging. It is big business, a global supply chain, and an ingredient in big brand consumer products. Irresponsible production damages the environment, influences climate change and affects biodiversity – but local communities and economies depend on the trade. Plus it is in the full glare of the NGO spotlight and the media, making the companies involved decidedly uncomfortable.

Prior to Greenpeace's campaign, business leaders were already making clear statements about their standards and goals for working towards sustainable production of palm oil. As the Sinar Mas crisis hit, there was a range of responses. Some companies stepped up their efforts, disassociated themselves from Sinar Mas, and took crisis management action. Some brands seemed to keep their heads down: KFC, Dunkin Donuts, Pizza Hut and Cargill went for a policy of continued engagement with all parties, including Sinar Mas.

Unilever and General Mills have recently released information on the improvements they have made around striving for sustainable palm oil. The Body Shop has announced it is severing commercial ties with a supplier in Colombia which is forcing resettlements of local communities.

These responses point to a robust and considered approach, based on having longer term experience of the issue and its challenges. The same can be said about Nestlé and Burger King's communications. They were prompted by a crisis, but came across as measured and appreciative of the issues, and saved them from much of the negative commentary.

The effect of Sinar Mas's responses was the opposite. Steeped in claim and counterclaim, its words fed an already highly charged NGO campaign. Its crisis communications strategy seemed routed in faceless PR tactics and made little effort to engage with stakeholders online. This was compounded by a distinct impression that the satellite stories about positive investment in the palm oil industry were planted in an effort to patch up its damaged reputation.

This is an edited version of an article from Salter Baxter's upcoming 'Directions2010' report.